In 1978, Kusturica graduated from the film school (FAMU) at the Academy of Performing Arts in Prague, which is why he is sometimes considered a part of the Prague film school, an informal group of Yugoslav film directors who studied at FAMU and shared similar influences and aesthetics. After graduating from FAMU, Kusturica began directing made-for-TV short films in Yugoslavia.

Kusturica continued to make highly regarded films into the next decade, including his American debut, the absurdist comedy Arizona Dream (1993). He won the Palme d'Or for his black comedy epic, Underground (1995), based upon a scenario of Dušan Kovačević, a noted Serbian playwright.[13] He also taught Film Directing at Columbia University's Graduate Film Division.

In 1998, he won the Venice Film Festival's Silver Lion for Best Direction for Black Cat, White Cat, a farcical comedy set in a Gypsy (Romany) settlement on the banks of the Danube. The music for the film was composed by the Belgrade-based band No Smoking Orchestra.

During the promotion of his autobiography in 2010, Kusturica was asked why he thinks his cinematic style translates well in the West when so many Eastern European, Yugoslav or Serbian authors never managed to do the same:

“

My oeuvre was born while moving around from Sarajevo to Prague via Belgrade, at the exact spot where communism started to disintegrate. While at the same time in parallel a mythical projection of that downfall was being created with stuff like Karol Wojtyła being elected as the Pope to steer things down that road. And I entered that corridor like Chaplin entered the revolution and I came out through a door where my movies that feature love-filled depictions of some of these things happened to find a receptive audience. I underscore love here because I was never anti-communist. Quite the contrary, some of my deepest personal convictions were shaped and molded in that system though I obviously don't put much from that system into practice when it comes to my own life. So I sort of entered into that mythical projection of the tear-down of communism with my first two feature films, which communicated through poetic narrative, but without a trace of hate, unlike say Yugoslav Black Wave that actually disqualified communism in every way possible. I on the other hand, out of affection for my father who was a staunch communist and my family that fought in World War II on the Partisan side, extended that love into those movies as well. And the West took to it because the West isn't one big monolithic entity. I realize that to many ordinary people in Serbia, the West is Olli Rehn or some other similar fat and balding EU bureaucrat, but fortunately there's more to it. Another thing is this. When I submitted When Father Was Away on Business to the Cannes Film Festival back in 1985 it was one of 700 films the selectors had to sift through and choose some dozen or so for the competition program. When I did the same with Underground a decade later it was one of 1,200 films. Nowadays, we're talking 2,500 to 3,000 films every year submitted at Cannes. So in that gargantuan quantity, your quality really has to shine through. And for me quality was fierce authenticity. So to recap, why do I think the West is receptive to me? First and foremost, I got in at a good moment during the tear-down of communism or more specifically the tear-down of Bolshevism. And secondly, no less importantly, they respond to my genuine commitment to the basic authentic motifs that have been existing here in the Balkans for centuries.[17]

In September 2012 Emir Kusturica accepted the offer to become the head juror of the first Saint Petersburg International Film Festival. During the festival Kusturica also performed for the residents and guests of Saint Petersburg with his band "The No Smoking Orchestra"

During the last months of 2013, Kusturica started shooting a documentary film on the life of the Uruguayan president José Mujica, whom he considers "the last hero of politics".[19]

Kusturica currently acts as the president of the Ski Association of Serbia.[citation needed]

In mid-1986, Kusturica, already an accomplished film director at the time, started playing bass guitar in Zabranjeno Pušenje, a Sarajevan punk rock outfit that had been the main driving force behind the New Primitivism movement. In addition to being on friendly terms with the guys and admiring their work, Kusturica's inclusion in the group had to do with the difficult situation Zabranjeno Pušenje found itself in following the political and media scandal caused by the verbal offence committed by their frontman Nele Karajlić.

The so-called 'Marshal affair' that played out throughout late 1984 and early 1985 severely limited the band's access to media, causing its second album to sell poorly; additionally, three of the six members left the group in light of its bleak commercial prospects. Therefore, in 1986 as the band was still reeling from the scandal and devising strategy for the future, the thinking behind bringing Kusturica on board was that having the famous and celebrated film director affiliated with Zabranjeno Pušenje would help it get over the media bans it faced.

Kusturica's contribution included playing bass on three track from the band's third studio album Pozdrav iz zemlje Safari as well as composing the music for the "Probušeni dolar" track on the same album. Furthermore, he directed the video for the track "Manijak", which was deemed controversial, receiving a television ban due to vague visual allusions to the Agrokomerc Affair,[citation needed] yet another political scandal brewing in Bosnia at the time. Still, with hit songs like "Balada o Pišonji i Žugi", "Hadžija il bos", and "Dan Republike", the band managed to regain its popularity and commercial success. Though never fully involved in the band's day-to-day life, Kusturica left Zabranjeno Pušenje in 1988.

Kusturica's autobiography, Death is an Unverified Rumour (Смрт је непровјерена гласина / Smrt je neprovjerena glasina), was published in October 2010 in Belgrade by Novosti. The launch took place on 26 October during the Belgrade Book Fair and was attended by Nele Karajlić, Dušan Kovačević, foreign minister Vuk Jeremić, Vojislav Koštunica, etc.[20][21][22] Initially released only in Serbia, Montenegro, and Republika Srpska, the book's first printing of 20,000 copies quickly sold out. The second printing of 32,000 copies was out in November and it too sold within weeks. On 8 December, the third printing in 40,000 copies was out[23] and promoted a day later at Belgrade's Dom Sindikata.[24] In February 2011, a fourth printing with further 10,000 copies was out and soon the sale of the 100,000th book was announced.[25] The final number of copies sold by the publisher was 114,000.[26]

Translations were published in Italy (translated by Alice Parmeggiani) on 30 March 2011 under the title Dove sono in questa storia ("Where am I in this Story"),[27] in France by JC Lattès on 6 April 2011 as Où suis-je dans cette histoire ?,[28] and in Germany in September 2011 as Der Tod ist ein unbestätigtes Gerücht.[29] In 2012, the book was published in Bulgaria as Cмъpттa e нeпoтвъpдeн cлуx, in Greece as Κι εγώ πού είμαι σ' αυτή την ιστορία;, in Romania as Unde sunt eu în toată povestea asta, and in Hungary as Hogy jövök én a képbe?.

Kusturica's second book, a fictional novel Hundred Pains (Сто јада / Sto jada), got released in Serbia on 24 April 2013 by Novosti a.d.[26][30] in the initial printing of 35,000 copies. On 6 June, the second printing came out in the circulation of 25,000.[31] The book's translated form was released in France in January 2015 by JC Lattès as Étranger dans le mariage.

During 2007, Kusturica and Nele Karajlić prepared a punk opera, Time of the Gypsies. The initial idea came five years earlier in 2002 from Kusturica's collaborator Marc di Domenico while the support of the Paris Opera director Gérard Mortier got the project rolling. Basing the production on his eponymous 1988 film, Kusturica wrote the libretto by adapting the story of the Gypsy youth from the Balkans relocating to Italy in order to obtain money for his ill sister's surgery. The director cast young Serbian folk singers Stevan Anđelković and Milica Todorović in the roles of Perhan and Azra, respectively, while the experienced Karajlić took the role of Ahmed Đida. The music in the original movie had been composed by Goran Bregović; however, since Kusturica and he have not been on speaking terms since the late 1990s, those songs couldn't be used.[34] The all-new score was composed by Dejan Sparavalo of The No Smoking Orchestra.

The premiere took place in June 2007, at the Opéra Bastille in Paris, to positive reviews.[34][35][36] Following the vast open stage of Bastille, the show was performed in smaller arenas. In March 2008, the production was staged in Paris' Palais des congrès.[37]

Since 2008, Drvengrad hosts the annual Küstendorf Film and Music Festival,[41] which showcases films and music from all around the world as well as a competition programme for student short films. The festival is known for not having a red carpet as well as none of the popular Hollywood festival artifacts.

My father was an atheist and he always described himself as a Serb. OK, maybe we were Muslim for 250 years, but we were Orthodox before that and deep down we were always Serbs, religion cannot change that.[10][44][46]

”

Despite the aforementioned conflict of religion, Kusturica refused to see himself as either a Bosniak or Serb. Instead, he had continued to insist that he was simply a Yugoslav.[43]

When his mother was on her deathbed he wanted to find out his ancestry and learnt that the origin of the Kusturica family stemmed from two Orthodox Christian branches.[47] An ancestor of his, who helped build the Arslanagić bridge in the 18th century, hailed from Bileća and the Babić family.[48] According to the studies of geographer Jevto Dedijer (1880–1918) in the Bileća region (1902): the Kusturica family lived in a čopor (grouped area, literally "pack") in the village of Plana; they had eight houses next to the Kozjak family (four houses), northwest across a field from the Avdić family (23 houses).[49] In Granica, there was a family surnamed Kusturica which had left Plana 80 years earlier.[49]

According to the Avdići, their progenitor Avdija Krivokapić, an Islamized Montenegrin, reportedly was honoured by the Sultan for his military service and on the way home to Herzegovina, in Kyustendil, he bought a gypsy and brought him to Plana; this gypsy was, according to them, an ancestor of the Kusturica family.[49] The story, however, as was common, was motivated by traditional disputes of neighbouring families regarding status in the village.[50] According to Savo Pujić, an ancestor was Hajdarbeg Kusturica who was a čauš (officer) who lived in Volujak and was said to have been fair, having repurchased Muslim slaves, protected Orthodox clergy and his subject peasants.[50] The name is derived from kustur, an Old Slavic word for dull knives, sabres, etc., most often referring to sabres.[51]

Regarding Vladimir Putin, he said in 2012: "If I was English I would be very much against Putin. If I was American I would even fight with him, but if I was Russian I would vote for him".[54] Kusturica was present at the Kremlin for Putin's third inauguration as president in May 2012.[55] He has expressed support for the 2014 Russian annexation of Crimea.[56]

Kusturica was awarded the Order of St. Sava, First Class, for his "selfless care and presentation of the Serbian nation in the world", on 12 May 2012.[57] On 4 November 2016 he received the Order of Friendship from Vladimir Putin in Moscow.[58] He communicated in Russian at the event.[59]

Kusturica and his work have provoked controversy at home and abroad.[60]Underground, scripted by Dušan Kovačević, was partly financed by state-owned Yugoslav television. It recounted the history of Yugoslavia from World War II until the conflicts during the 1990s. Bosnian and French critics claimed the film contained pro-Serb propaganda.[61][62]

French philosopher and writer Alain Finkielkraut, a supporter of the Croatian president Franjo Tuđman during the 1990s,[63] denounced the Cannes Film Festival's jury award, saying:

In recognizing "Underground", the Cannes jury thought it was honouring a creator with a thriving imagination. In fact, it has honoured a servile and flashy illustrator of criminal clichés. The Cannes jury ... praised a version of the most hackneyed and deceitful Serb propaganda. The devil himself could not have conceived so cruel an outrage against Bosnia, nor such a grotesque epilogue to Western incompetence and frivolity.[62]

It was later revealed that Finkielkraut had not seen the film before writing his criticism.[64][65][66]
French philosopher Bernard-Henri Lévy made a film criticizing Underground.[61] In a discussion with Levy, the Slovenian philosopher Slavoj Žižek said:

I hope we share another point, which is – to be brutal – hatred of [director] Emir Kusturica. Underground is one of the most horrible films that I've seen. What kind of Yugoslav society do you see in Kusturica's Underground? A society where people fornicate, drink, fight – a kind of eternal orgy.[67]

Considering he proclaimed his dead father a Serb, and himself, Emir, an Orthodox Christian, he easily chose his own in the Bosnian War. He recognized them in Radovan Karadžić and Ratko Mladić. He wasn't there to fire cannon barrages, but whenever he could, with his artistic and media get-up he provided them an alibi for every killed Muslim who didn't want to admit that he was originally an "Orthodox Christian".[This quote needs a citation]

Kusturica sued Nikolaidis and the Monitor newspaper for civil damages at the Supreme Court of Montenegro. In the end, Nikolaidis was ordered to pay $6,490 to Kusturica for calling the famed director a "media star of Milosevic's war machinery".[69] The judge ruled that the evidence was not credible enough.[70] In the end Nikolaidis and the paper were fined 12,000 euros for breaking the code of journalism by calling Kusturica "stupid, ugly and corrupt" in the article.[71]

The criticism of Kusturica was started by an organization called the Turkish-Bosnian Cultural Federation as soon as Kusturica was announced as a jury member.[73] Turkish media reported that Kusturica repeatedly downplayed the number of people killed and the rape of Muslim women during the war.[72] It was not clear when Kusturica was supposed to have made those comments, but the daily newspaper Milliyet said Kusturica denied the allegations.[72]

Public sentiment in Turkey and in Serbia was such that a couple of days after Kusturica left Turkey, there were news reports by Serbian tabloids claiming that a mob of Turkish youths in Antalya physically assaulted Swiss actor Michael Neuenschwander (in town to promote his movie 180° – Wenn deine Welt plötzlich Kopf steht) because they mistook him for Kusturica due to apparent physical resemblances between the two.[74] Later, Neuenschwander's press agent said there was no physical assault and that Neuenschwander was verbally abused by a small group.[75]

Kusturica later commented on the incident:

“

I did receive a sincere apology from the mayor of Antalya Mustafa Akaydın over what happened. Essentially, I became collateral damage in the ongoing political fight between the central powers from the ruling coalition in Istanbul and the municipal authorities in Antalya where the local power is held by a social-democrat party. But regardless of everything, this is completely unacceptable on a basic level – when you're an invited guest somewhere, your hosts simply cannot behave in this manner. And this run-in I had was with a part of Turkish society, the part that consists of highly-evolved primitives. I am not a politician and I'm not obliged to comment on and dissect every crime or genocide around the world. And then I got very angry and I told them if they're so sensitive about genocide it would be much better for them to publicly condemn the genocide they committed against the Armenian people, before having a go at me with accusatory statements. I clearly condemned the crimes in Bosnia, but the 'problem' is that I condemned the crimes committed by all sides, which makes me incompatible with the strategy they have for Bosnia.[76]

Philippe Rotthier European Architecture Award for his ethnic village project Küstendorf (also called Drvengrad – "wooden town") on Mt. Zlatibor, Serbia, in 2005. The prize is awarded every three years by the BrusselsFoundation for Architecture.

In 2004, The Prix de l'Education nationale (National Education Prize) honored Emir Kusturica and his film Život je čudo (Life is a Miracle).